The Market Economy (Grade 11 NSC Matric Economics): Flashcards
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Market economy
Market economy
System using demand & supply to guide economic decisions
Alternative name for market economy
Alternative name for market economy
Free market system
3 basic economic questions
3 basic economic questions
What, how, and who to produce for
Main motivator in market economy
Main motivator in market economy
Profit motive (desire for highest profits)
Ownership of factors of production
Ownership of factors of production
Private individuals & businesses, not government
Govt role in market economy
Govt role in market economy
Minimal - basic services only (defence, law)
Market economy advantage: production
Market economy advantage: production
Efficient - competition forces wise resource use
Market economy advantage: consumers
Market economy advantage: consumers
Wide range of products to choose from
Market economy disadvantage
Market economy disadvantage
Uneven income/wealth distribution (inequality)
Market failures
Market failures
When market doesn't work efficiently; needs intervention